Practice Areas

Severance Tax

Ryan delivers proven strategies that maximize every severance tax benefit—from incentive identification to compliance—to ensure maximum economic recovery and full utilization of every potential benefit.

Ryan Expertise

Ryan has been a tremendous business partner for many years through assisting Energen Resources in addressing complex multistate severance tax issues and in reducing our tax burden.
Wm. Douglas Marshall Director, Corporate Taxation client logos_testimonial_energen
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Severance Tax

Ryan's Severance Tax consultants utilize a full-service approach to ensure all production tax incentives are identified and captured so that the minimum amount of tax is paid. Although a thorough understanding of tax compliance procedures is important, accurate compliance alone cannot minimize severance tax liability. Organizations must aggressively pursue all available production incentives to ensure they pay the minimum amount of tax. This process begins in the field by identifying properties that may qualify for an incentive and ends with documenting the incentive on the tax return, where the real economic value is realized. We begin our process with an in-depth analysis of our client's field operations and compliance efforts, enabling us to identify specific opportunities.

We have the ability to target where the opportunity lies and can identify the lease, the parties on the lease, and the time periods affected by the incentive. We begin each project by performing a thorough analysis of our client's operations. We then research each well thoroughly on an individual basis to ensure that all available opportunities have been identified and quantified. The majority of this work is done offsite with information obtained from government and public sources. With the client's full knowledge and prior approval, we then aggressively pursue each opportunity, minimizing our client's tax liability in a consistent and efficient manner.

Our tax professionals have experience in all facets of oil and gas taxation, including governmental auditing experience, "Big Oil" staff and management experience, and national public accounting experience. This breadth of experience ensures that our professionals understand all aspects of tax incentives and compliance—from identification through application and implementation to reporting. Our comprehensive services include:

  • Incentive identification and certification services
  • Drilling schedule reviews
  • Compliance data scrubs
  • Marketing cost deduction recalculation services
  • Severance tax process initiatives
  • Tax reimbursement contract reviews
  • Adjustment notice consulting services
  • Sales and use tax credit recovery services

The oil and gas industry faces unique challenges related to reporting royalties for production on federal land.  Frequent changes in the rules and guidelines set forth by the Office of Natural Resources Revenue (ONRR), along with vague orders to unbundle, make it difficult to maximize incentives and deductions while maintaining regulatory compliance and avoiding civil penalties.

Ryan’s Federal Royalty practice minimizes royalty burdens and mitigates the risk of civil penalties, providing clients the additional capital needed to manage and grow their businesses.Our history of collaborating with ONRR has provided us a thorough understanding of the complex royalty issues the industry faces.  With an established track record of delivering high quality work product that ONRR can trust, our clients experience more timely processing of refunds and more efficient audits.  In addition, our relationship with ONRR has afforded us several opportunities to be at the forefront in the development of industry standards for calculating allowable transportation and processing allowances. 

Our understanding of widely used accounting systems, production systems, and ONRR’s review processes allows us to effectively maximize all available incentives and deductions in a non-intrusive fashion while minimizing the burden of compliance. We begin each project by performing a thorough analysis of our client's operations. We then research each well thoroughly on an individual basis to ensure that all available opportunities have been identified and quantified. The majority of this work is done offsite with information obtained from government and public sources. With the client's full knowledge and prior approval, we then pursue each opportunity, minimizing our client's royalty liability in a consistent and efficient manner. Our comprehensive services include:

  • Non-arm’s length transportation/processing allowance calculations
  • Arm’s length transportation/processing allowance recalculation services
  • Volume and value verification services
  • Royalty relief identification and certification services
  • Application of ONRR calculated unbundling cost allocations (UCAs)
  • Audit defense services
  • Data mining request consulting services

Ryan also provides a full-service approach to mining tax management. Our proven record of delivering substantial tax savings for all types of industry clients—from large precious metal miners to producers of geothermal power—is unparalleled. Whether it’s ad valorem, severance, mine license, or gross/net proceeds types of production taxes, we manage all phases of tax compliance and controversy to significantly reduce our client’s tax liability.  From scrutinizing mine valuation, recalculating available deductions, or reviewing existing compliance efforts, our team leverages creativity, technical expertise, and a critical knowledge of state and local regulatory procedures to find and maximize every potential economic benefit. 

We thoroughly analyze the reports of all operated and non-operated mines to uncover opportunities, and then present preliminary schedules outlining the targeted benefit to the client before any work is done. If approved, we carefully develop and deploy the appropriate plan to recover any overpayments, as well as take steps to ensure that correct reporting occurs prospectively. 

Our experience analyzing production data allows us to identify when mine valuations are too high and where economic benefit may be available to the client. While our focus is on historic results, we know our efforts often yield significant prospective benefits to our clients in the form of reduced valuations or improved compliance methods.

Integrated End-to-End Tax Services

Ryan is focused on your overall tax performance—providing innovative solutions to the underlying causes of the errors we identify—and creating greater opportunities to measure and improve your efficiency, develop a more strategic approach to tax, and deliver outstanding value to your shareholders.